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Carrefour to acquire Walmart’s Grupo BIG in Brazil

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MASSY, France–(BUSINESS WIRE)–Regulatory News: Grupo Carrefour Brasil has entered into an agreement with Advent International and Walmart BB #:143789 for the acquisition of Grupo BIG Brasil SA, Brazil’s third-biggest food retailer.

This acquisition strengthens Carrefour Brazil’s presence in this high growth potential market. It will allow it to offer Brazilian consumers a broader range of products and services at more competitive prices.

The transaction values Grupo BIG at an enterprise value of R$7.0bn1 (c.€1.1bn). This acquisition offers significant synergy potential from year one, rising gradually to represent a net additional contribution to EBITDA of R$1.7bn (c.€260m) on an annual basis three years after the closing of the transaction.

Combined, the two groups have gross sales of about R$100bn, operate 876 stores and employ around 137,000 people. Present in Brazil since 1995, Grupo BIG operates a multi-format network of 387 stores and generated R$24.9bn gross sales (R$21.7bn net sales) and R$928m adjusted EBITDA in 2020.

Carrefour Brazil, which has been present in the country since 1975, operates 489 stores and generated R$74.7bn gross sales (R$67.6bn net sales) and R$5.6bn adjusted EBITDA in 2020.

Alexandre Bompard, Chairman and CEO of Carrefour Group, declared: “Our Group is on the offensive: The acquisition of the BIG Group is a major transformation movement for Carrefour Brazil. In this continental country with immense development prospects, we have accentuated our leadership in the food distribution market over the past 3 years, and BIG will further strengthen it with very complementary formats and locations. The transaction fits perfectly into the Carrefour Brazil ecosystem and into the Group’s acquisition strategy, centered on the consolidation of our key markets. The significant synergies generated by this transaction are a lever for creating additional value and a powerful addition to the profitable growth model that we have established across our Group.”

Strategic rationale

The acquisition of Grupo BIG strengthens Carrefour’s leadership in Brazil. The two groups offer strong geographic complementarity, and the transaction will expand Carrefour Brazil’s presence in regions where it has limited penetration, such as the Northeast and South of the country, and that offer strong growth potential.

The acquisition allows Carrefour Brazil to expand in its traditional formats, notably Cash & Carry (Maxxi banner) and hypermarkets (BIG and BIG Bompreço banners), while extending its footprint in formats in which it has a more limited presence, in particular supermarkets (Bompreço and Nacional banners) and proximity stores (Todo Dia banner).

In addition, Carrefour Brazil will operate in a new market segment with the Sam’s Club format, through a license agreement with Walmart. This unique and highly profitable premium business model is based on a membership system, with over 2 million members.

The combination of the two groups will enrich Carrefour Brazil’s ecosystem of products and services, which currently serves over 45 million customers. Grupo BIG’s broad base of customers will become part of the Carrefour Brazil ecosystem and benefit from the complete experience of an omnichannel environment.

They will notably have access to an extended e-commerce offering, as well as to Banco Carrefour’s payment and credit solutions, which will be made available in all stores.

About Grupo BIG

Present in Brazil since 1995, Grupo BIG (formerly Walmart Brazil) operates a multi-format network of 387 stores, comprising 35 membership-only stores under the Sam’s Club banner, 107 hypermarket stores under the BIG and BIG Bompreço banners, 99 supermarket stores under the Bompreço and Nacional banners, 97 soft discount stores under the Todo Dia banner, 49 Cash & Carry stores under the Maxxi banner as well as 13 gas stations. Grupo BIG has a presence in 19 states, with a larger footprint in the southern and northeastern regions of Brazil. In 2020, Grupo BIG generated gross sales of R$ 24.9 billion and adjusted EBITDA of R$ 928 million.

About Carrefour Brazil

Carrefour Brazil operates 489 stores in Brazil, including 100 hypermarket stores under the Carrefour banner, 53 supermarket stores under the Carrefour Bairro and Market banners, 130 proximity stores under the Carrefour Express banner, 206 Cash & Carry stores under the Atacadão banner, as well as 125 pharmacies and 77 gas stations. In 2020, Carrefour Brazil generated gross sales of R$ 74.7 billion and adjusted EBITDA of R$ 5.6 billion.

About Carrefour Group

With a multi-format network of some 13 000 stores in more than 30 countries, the Carrefour Group is one of the world’s leading food retailers. Carrefour recorded gross sales of €78.6 billion in 2020. It has more than 320,000 employees who help to make Carrefour the world leader in the food transition for everyone, providing everybody with access to high-quality, affordable food every day, in all locations.

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